Analyzing PACCAR (NASDAQ:PCAR) and XOS (NASDAQ:XOS)

PACCAR (NASDAQ:PCAR) and XOS (NASDAQ:XOS) are both auto/tires/trucks companies, but which is the better investment? We will compare the two companies based on the strength of their institutional ownership, analyst recommendations, risk, valuation, earnings, dividends and profitability.

Analyst Ratings

This is a summary of recent ratings for PACCAR and XOS, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
PACCAR	0	8	5	2	2.60
XOS	1	2	2	1	2.50

PACCAR presently has a consensus price target of $107.68, suggesting a potential upside of 9.78%. XOS has a consensus price target of $9.00, suggesting a potential upside of 213.59%. Given XOS’s higher probable upside, analysts plainly believe XOS is more favorable than PACCAR.

Volatility and Risk

PACCAR has a beta of 0.94, meaning that its share price is 6% less volatile than the S&P 500. Comparatively, XOS has a beta of 1.6, meaning that its share price is 60% more volatile than the S&P 500.

Profitability

This table compares PACCAR and XOS’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
PACCAR	9.88%	18.25%	7.69%
XOS	-91.56%	-147.93%	-48.78%

Insider & Institutional Ownership

64.9% of PACCAR shares are held by institutional investors. Comparatively, 12.9% of XOS shares are held by institutional investors. 2.0% of PACCAR shares are held by company insiders. Comparatively, 20.9% of XOS shares are held by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company will outperform the market over the long term.

Valuation and Earnings

This table compares PACCAR and XOS”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
PACCAR	$33.66 billion	1.53	$4.16 billion	$5.84	16.80
XOS	$55.96 million	0.45	-$50.16 million	($5.85)	-0.49

PACCAR has higher revenue and earnings than XOS. XOS is trading at a lower price-to-earnings ratio than PACCAR, indicating that it is currently the more affordable of the two stocks.

Summary

PACCAR beats XOS on 12 of the 15 factors compared between the two stocks.

About PACCAR

PACCAR Inc designs, manufactures, and distributes light, medium, and heavy-duty commercial trucks in the United States, Canada, Europe, Mexico, South America, Australia, and internationally. It operates through three segments: Truck, Parts, and Financial Services. The Truck segment designs, manufactures, and distributes trucks for the over-the-road and off-highway hauling of commercial and consumer goods. It sells its trucks through a network of independent dealers under the Kenworth, Peterbilt, and DAF nameplates. The Parts segment distributes aftermarket parts for trucks and related commercial vehicles. The Financial Services segment conducts full-service leasing operations under the PacLease trade name, as well as provides finance and leasing products and services to customers and dealers. This segment also offers equipment financing and administrative support services for its franchisees; retail loan and leasing services for small, medium, and large commercial trucking companies, as well as independent owners/operators and other businesses; and truck inventory financing services to independent dealers. In addition, this segment offers loans and leases directly to customers for the acquisition of trucks and related equipment. The company also manufactures and markets industrial winches under the Braden, Carco, and Gearmatic nameplates. PACCAR Inc was founded in 1905 and is headquartered in Bellevue, Washington.

About XOS

Xos, Inc. is an electric mobility company engaged in manufacturing electric trucks. The firm designs and develops fully electric battery mobility systems specifically for commercial fleets. The company was founded by Dakota Semler and Giordano Sordoni on July 29, 2020 and is headquartered in Los Angeles, CA.